CPB offers limited loans to ailing pubTV stations
To assist fiscally troubled pubTV stations, CPB will give a limited number of advances, up to $420,000 each, on their Community Service Grants, the corporation’s board voted last week.
The interim amendment to TV Community Service Grant policies will be in place at least until September, when CPB begins its periodic review of those policies. CPB will offer the loans to keep struggling stations operating, going beyond its present offer of consultants and budgeting advice.
One station, WTVP in Peoria, Ill., benefited from such an advance last year before CPB had developed a formal policy. Another Illinois pubTV licensee has applied for an advance: Network Knowledge, a three-station group based in Springfield. [Correction]
Mark Erstling, senior v.p. for television, told the board that Illinois is a “bellwether state” for developing strategies for collaborations and mergers. CPB reps will meet with several g.m.s there as soon as August. CPB may also work with eight stations in a state that are interested in sharing a master control setup. Erstling declined to name the state.
Advances will be siphoned from the $210 million pool of fiscal 2010 TV CSG funds. Because CPB has limited funds that aren’t already committed, it will cap its total advances at 1 percent of the pool, or $2.1 million.
No advance could be more than 50 percent of the station’s CSG for that year or exceed 20 percent of the earmarked funds, or $420,000.
An advisory panel of pubcasters decided that was “an appropriate amount to put aside without doing harm to the rest of the system,” Erstling said. As the conduit for most federal station aid to the system CPB receives its annual appropriation Oct. 1.
Stations will have up to four years to repay, through reduction of their future CSG installments. That’s happening now with the pubTV station in Peoria. Forced to repay a capital loan last year, the station successfully appealed for help from CPB and local supporters. CPB gave WTVP a $200,000 advance to be repaid by subtraction of $20,000 from each of its twice-a-year CSG payments for five years.
The station now “looks to be sustainable,” said COO Vinnie Curren at the July 16 meeting. So advances “were an important tool, in our mind,” Erstling said.
But because the money comes from a station pool, “we felt it was important to do consultation with station leaders,” Erstling said. Meeting by telephone June 24 were Malcolm Brett, Wisconsin Public Television; Joe Bruns, WETA; David Dial, WNIN, Evansville, Ind.; Lonna Thompson of the Association of Public Television Stations; and two PBS officials, Station Services Senior Vice President Joyce Herring and COO Michael Jones.
They concluded the advances are “an appropriate use of funds if managed in a careful manner,” Erstling reported, “as a last resort for a station, loaned only when absolutely necessary.” Also, the cash should not go to stations with an unsustainable financial future.
The group advised against rolling over any uncommitted money that had been earmarked for advances, so the pool won’t grow each year.
CPB Board member Lori Gilbert, a broadcast news director from Elko, Nev., said the proposal left her worried about “giving any station more time to fail.” She also wondered whether the loans would become a liability for future CPB boards if they’re not repaid.
That’s why the panel stressed careful selection of the stations, Erstling said, proposing advances only to those whose long-term financial viability appears likely.
To receive an advance, a station must apply through CPB’s Stations in Severe Financial Distress program, which is open to public radio as well as TV. The applicant must submit to a rigorous examination of books, management and engineering. “It’s a very heavy decision they won’t make lightly,” Curren said.
Correction: Pubradio station WHQR in Wilmington, N.C., applied for CPB's Stations in Severe Financial Distress program but was not a pending applicant for the CSG advances, which are designed for public TV stations.
Web page posted July 20, 2009, corrected July 21, 2009
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